Obama Slaps New Sanctions on Buyers of Iran Oil

President Barack Obama is pushing forward with new sanctions designed to cripple Iran's oil exports. The president said Friday there is enough oil on world markets to allow him to take the step without harming U.S. allies

President Obama signing Iran Sanction Act in June 2010

President Obama's move authorizes U.S. sanctions on foreign banks that continue to purchase oil from Iran.

It is aimed at further isolating from world markets Iran's central bank, which handles most of the proceeds from the country's oil sales.

Friday's announcement from the White House is part of a campaign by the United States and its allies to increase pressure on Iran to abandon its nuclear program.

The Western allies believe Iran is working toward building a nuclear bomb. Iran says its nuclear program is for peaceful purposes.

Senior White House officials say Japan and the European Union have already taken steps to reduce their oil purchases from Iran, and have been exempted from the sanctions. The officials believe other nations will follow, including South Korea and Turkey.

The penalties are to take effect in late June, shortly before the EU oil embargo is enacted.

At the State Department, spokesman Mark Toner said many of America's allies have been cooperating.

"And certainly the announcement a couple weeks ago of those countries that we believe have made substantial progress in this indicate that we're confident that we can do this in a very coherent, deliberative fashion that's not going to disrupt the market," he said.

A defense bill Mr. Obama signed in December gave him until Friday to determine whether there was enough oil on the world markets to allow the cuts in imports from Iran.

In a written statement, the president said while the global oil market remains tight, there is enough supply to allow countries to cut their oil imports from Iran.

Mr. Obama said he would continue to monitor the situation closely.

Seven months before the U.S. presidential election, rising gasoline prices are causing concern among voters.